Reuters: Regulatory News: Two investors must pay Goldman's legal fees -panel

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Two investors must pay Goldman's legal fees -panel Jun 4th 2012, 20:04 By Suzanne Barlyn June 4 | Mon Jun 4, 2012 4:04pm EDT June 4 (Reuters) - Two investors must pay $500,000 in legal fees to a Goldman Sachs unit after losing an arbitration case against the firm involving a options trading strategy, an arbitration panel has ruled. Eric Snyder, a former real estate investment trust executive, and his wife, Barbara, filed "clearly erroneous" claims against Goldman Sachs, according to a Financial Industry Regulatory Authority arbitration award posted Monday on FINRA's website. The Snyders originally sought $10 million for allegedly recommending unsuitable investments, misrepresenting information and breaching its duty of fair dealing to them, among other misdeeds. A FINRA panel in Atlanta, Georgia, not only rejected those claims, but ordered the Snyders to pay $500,000 to cover Goldman's legal fees and costs, according to the ruling dated May 30. A law in Tennessee, where the Snyders lived at the time of the dispute, authorized the panel to award legal fees to Goldman, according to the ruling. The panel also recommended removing a disclosure about the investors' complaint from two brokers who advised them, a process known as expungement. The outcome in the case is a rare instance in which an arbitration panel has ordered investors who lost the case to pay a brokerage firm's legal fees, say lawyers. "It's a head turner," said Andrew Stoltmann, a Chicago-based lawyer who represents investors in arbitration cases. The combination of the panel ordering the investors to pay legal fees and recommending to expunge the brokers' records "is about as harsh as a claimant... can get," he said. A Goldman spokeswoman was not immediately available for comment. Eric Snyder and a lawyer for the Snyders and did not immediately return calls requesting comment. Link this Share this Digg this Email Reprints

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